For decades, Washington has believed that trade and technology would integrate China into a more open, rules-based international order. But now, the two global superpowers are experiencing conflicts in all areas – from chips and artificial intelligence to supply chains and technological standards, from cyberspace to outer space, from ideology to influence. In this process, the international alliance structure and the global economic landscape are being reshaped.
Experts describe this as a “Cold War-style contest”, but there is a key point of contention: the two countries remain closely connected in trade and finance, and they have not completely severed these ties, but rather are actively reshaping their modes of operation.
Washington emphasizes “de-risking” and “targeted decoupling”, while Beijing is formulating its own laws, regulatory measures, and export leverage, which often deviate from international standards. Experts believe that this tug-of-war is likely to define the future direction of the relationship between the two countries, with far-reaching impact beyond 2027.
In 1972, President Richard Nixon’s visit to China ended decades of hostility, paving the way for the United States to formally recognize the communist government in 1979. Prior to this, Washington only recognized the Republic of China government in Taiwan as the sole legitimate government of China.
In 2001, the shift in foreign policy paved the way for China’s accession to the World Trade Organization (WTO), opening up a vast channel for its entry into the global market, driving rapid growth of its export-oriented economy, and making China a core hub in the global supply chain.
Washington had expected that deeper integration would lead Beijing towards a more market-oriented, rule-abiding, and democratic path.
However, things did not go as planned.
The Chinese Communist Party (CCP) enforced technology transfers, heavily subsidized state-owned enterprises, blocked foreign competitors from entering the market, and tolerated widespread intellectual property theft – all actions that violate the basic principles of the WTO.
The CCP’s strategy has yielded significant results in terms of economic strength. China’s nominal GDP has surged from around $1.3 trillion in 2001 to about $19.2 trillion in 2025, growing more than 14 times.
Accompanying this growth is a more aggressive posture.
Hacktivist groups supported by the Chinese government have infiltrated U.S. government institutions, businesses, critical infrastructure, universities, think tanks, and media organizations, controlling policy directions and public opinion to align with Beijing’s interests.
Furthermore, large amounts of fentanyl precursors from China have flooded into the U.S., fueling the American opioid crisis, a strategy referred to by U.S. officials as “unrestricted warfare”.
The U.S.’s stance shifted in 2017 when the Trump administration’s “National Security Strategy” designated the CCP as the top competitor and strategic rival, a policy continued by both the Biden administration and the current administration under Trump.
Peter C. Y. Chow, an economics professor at the City University of New York, told The Epoch Times that Beijing’s actions after joining the WTO forced Washington to adopt a tough stance of “techno-nationalism and trade protectionism”.
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